Since it launched in 2011, MoviePass has been lauded for its ability to get people back out of their homes and into theaters. The company was able to secure ticket subscription deals with more than 90% of theaters across the country, including Cinemark, Regal and some independent chains. But now the discount ticket service is in financial trouble and angering many of its customers.
The latest indignity comes in the form of legal trouble: New York Attorney General Barbara Underwood has launched an investigation into MoviePass parent company Helios and Matheson. Underwood is looking into whether the company misled investor’s about its financial health, according to CNBC.com.
The move is just the latest blow to the almost-too-good-to-be-true movie ticket subscription service, which has been seen many of its fans turn against it.
Two months ago, former customers reported being re-subscribed when they tried to cancel the service. One user said on Twitter that, “I cancelled my Moviepass this morning & tonight I get an email claiming that I ‘accepted’ a new deal and my cancellation has been overwritten. Then I go to cancel my subscription again I keep getting an error message,” posted user Ryan Stranieri.
Other users described similar experiences on social media and online forums. The movie-ticket subscription service blamed it on a “bug.”
On money expert Clark Howard’s Facebook account, one user lamented the recent changes to MoviePass.
Is MoviePass going out of business? Company fights to stay afloat
On Tuesday morning, MoviePass’s parent company’s stock price all but collapsed after its latest earnings report showed that it lost a staggering $126 million in the second quarter. And now shareholders have filed lawsuits, according to The Wrap.
To make matters worse, over the past year, sturdier competitors flush with cash and possibly sounder business models have cropped up, giving MoviePass a real run for its money.
So is the company’s death imminent? It doesn’t look good. Here is a timeline of MoviePass’s successes and struggles:
MoviePass: A timeline of its recent hits & misses
October 2011: MoviePass is founded in New York City; the service experiments with different pricing models, charging subscribers between $29 and $34 a month.
August 15, 2017: MoviePass explodes in popularity when it drops tiered pricing and offers fans 30 films a month for just $10.
November & December 2017: For a short period during the holidays, the price of the service drops to a dirt-cheap $7 per month.
January 2018: In a show of bravado that we chronicled, the service takes on AMC, the nation’s largest movie theater chain, threatening to exclude it from its app if it doesn’t cooperate.
February 2018: The company continues to grow its subscriber base, reaching 2 then 5 million subscribers, even as it bleeds red ink.
March 2018: Controversy hits as the company reveals that it is tracking subscribers even when they aren’t at the theater.
July 2018: Money woes continue as the service is forced to take out an emergency loan to stay afloat, despite it reassuring customers that it was on firm financial standing.
July 31: In a letter to subscribers, CEO Mitch Lowe says the service must scale back on new movie offerings “at least for a while as we adjust the business model” and that “showtimes that are offered through our service will vary from day to day.”
August 6: To the chagrin of millions of subscribers, the service announces that as of August 15 it is limiting customers to three movies per month for $9.95.
August 16: MoviePass sends letter to subscribers telling them they will be able to see up to six films daily as part of a “transition period” as the service works up a sustainable monthly plan. The movies won’t be all the new ones, but rather “a selection of major studio first-run films and independent releases. In addition, showtime availability may be limited.”
September 2018: The struggling movie ticket subscription service is reactivating some of the canceled accounts of former subscribers, according to various news outlets. The service reportedly informs those users that — unless they opt out — they are part of a “select test group” to try a new version of MoviePass, according to tech site The Verge.
October 2018: New York Attorney General Barbara Underwood launches probe. In a tweet, Underwood said, “We’ve launched a securities fraud investigation into MoviePass’ parent company. My office is committed to protecting New York investors and the integrity of our financial markets.”
As of now, the company stresses that “we’re still standing,” but it doesn’t look good for its survival. To make matters worse, the Twitter account @MoviePassLaw recently launched with the purpose of gathering claimants for a class-action lawsuit.
So, what are MoviePass subscribers to do if and when the service goes kaput? Here are four ways to see new movies for free or close to it.